MTA’s $800 Million Budget Gap: What’s Going On?
So, why is the MTA staring down an $800 million budget shortfall, especially with millions generated from traffic congestion pricing? Well, new reports from the Citizens’ Budget Committee offer some insights.
The Budget Watchdog found that the agency missed out on about $1 billion in fare revenue last year. Surprisingly, while losses seem to be slowly declining, the CBC still suggests that fare evasion will result in another $900 million loss this year, assuming that the current trend continues.
The fare loss estimates from the CBC are pretty startling—much higher than the MTA’s own figures of $700 million to $800 million. In fact, this is three times what was lost in 2019.
That was just before COVID hit, but it’s also important to remember that around that time, the city’s district attorney decided to stop prosecuting most fare evasion cases.
On average, the report claims that individuals hopped onto the subway without paying about 330 times and rode the bus without a fare about 710 times. This kind of evasion is occurring every single minute in 2024.
Interestingly, that $1 billion in lost fare revenue is actually double what the MTA anticipates earning from congestion pricing this year. If fares were brought back to 2019 levels, the MTA might not need to rely on congestion pricing and could still be ahead by about $100 million.
Of course, it’s not easy to undo decisions once made. The agency, for its part, already opened a Pandora’s box by suspending bus fare collections during the pandemic.
Yet, the CBC’s data indicate that rates of fare evasion were climbing even before COVID-19. The spike started in the latter half of 2017 when Manhattan’s DA Cy Vance, concerned about the impact on his reelection prospects, claimed these cases weren’t cost-effective to prosecute.
This has had significant repercussions, as allowing fare evasion undermines the integrity of the entire system. Vance’s approach is a contributing factor to why many feel that both subways and buses seem less safe now compared to a decade ago.
Statistics do show a rise in arrests this year—finally! There’s been a 28% drop in subway-related incidents and an 8% drop on buses during the first quarter of this year compared to the same period in 2023.
Still, a staggering 43% of bus users and around 10% of subway riders aren’t paying their fares.
The MTA is trying various strategies to curb fare evasion. The report notes that unarmed security guards have led to an estimated 36% drop in fare evasion at certain locations.
Moreover, changes to the turnstiles have resulted in a 60% decrease in evasion rates.
However, nothing might be more effective than actual enforcement. It’s crucial that those who cheat the system face the consequences of their actions.
This brings up the delicate issue of selecting prosecutors who prioritize these cases.
Some progressives argue that penalizing fare evasion equates to criminalizing poverty.
In reality, it’s a complex issue. Many of those jumping turnstiles or riding the bus for free aren’t necessarily from low-income backgrounds. The MTA and the city do offer various discounts and free ride options for eligible low-income residents.
MTA Chief Janno Lieber understands that the continued loss of fare revenue not only impacts the agency’s finances but also affects the overall perception of safety in the transit system. Police Commissioner Jessica Tish and Mayor Eric Adams are on the same page.
Unfortunately, the city seems to be grappling with multiple leaders who are either unaware or unwilling to recognize the severity of the situation.
